Government Announces Tax Working Group Terms of Reference and Members

Throughout the Labour Party’s election campaign they promised to establish a tax working group (TWG) to review New Zealand’s tax system and consider changes that would improve the structure, fairness and balance of the tax system. Just before Christmas, the new Labour Government announced the TWG’s terms of reference and the members of the TWG.

The Government announced that certain areas will be outside the scope of the TWG’s review including, increasing the income tax rate, the rate of GST, inheritance tax and changes that would apply to the family home or land beneath it. The Government’s stated intention is to introduce more fairness across all taxpayers.In particular the TWG has been asked to consider the following:

  • the economic environment that will apply over the next 5-10 years, taking into account demographic change, and the impact of changes in technology and employment practices, and how these are driving different business models,
  • whether a system of taxing capital gains or land (not applying to the family home or the land under it), or other housing tax measures, would improve the tax system.
  • whether a progressive company tax (with a lower rate for small companies) would improve the tax system and the business environment, and
  • what role the taxation system can play in delivering positive environmental and ecological outcomes, especially over the longer term.

This opens the door to increasing tax thresholds so the lowest income earners pay less tax, and to the introduction of a capital gains tax.

Also before Christmas, the Government appointed the members of the TWG. Along with Chair, Sir Michael Cullen, the TWG members are:

  • Professor Craig Elliffe, University of Auckland
  • Joanne Hodge, former tax partner at Bell Gully
  • Kirk Hope, Chief Executive of Business New Zealand
  • Nick Malarao, senior partner at Meredith Connell
  • Geof Nightingale, partner at PwC New Zealand
  • Robin Oliver, former Deputy Commissioner at Inland Revenue
  • Hinerangi Raumati, Chair of Parininihi ki Waitotara Inc
  • Michelle Redington, Head of Group Taxation and Insurance at Air New Zealand
  • Bill Rosenberg, Economist and Director of Policy at the CTU
  • Marjan Van Den Belt, Assistant Vice Chancellor (Sustainability) at Victoria University of Wellington

Final recommendations are expected to be given to Ministers by February 2019. As stated before the election, any significant changes that are recommended from the TWG’s final report will not be legislated for until the 2021 tax year.

Copyright McIntyre Dick & Partners Ltd © 2015 / Site Map / Website Design by Back 9 Design